Lake Wallenpaupack could be put up for sale

Thursday

Jul 17, 2014 at 4:07 PM

LAKE REGION- PPL, the power company that formed Lake Wallenpaupack for power generation in 1926, has offered the lake and its power plant as one option if the company is required to cut output. In other words, Lake Wallenpaupack could end up for sale.

By Peter BeckerManaging Editor

LAKE REGION- PPL, the power company that formed Lake Wallenpaupack for power generation in 1926, has offered the lake and its power plant as one option if the company is required to cut output. In other words, Lake Wallenpaupack could end up for sale. PPL filed with the Federal Energy Regulatory Commission on Tuesday, July 15, requesting approval of its plan to combine PPL Energy Supply’s generation assets with Riverstone generation assets to form Talen Energy Corporation. The announcement was sent in an email to the PPL Lake Wallenpaupack Advisory Committee, by Katie Lester, Manager of Community Relations, on behalf of the company. A copy was shared with The News Eagle. The filing included proposals for divesting certain PPL Energy Supply and Riverstone power plants in order to satisfy FERC’s market power tests. The tests are designed to determine if any market power issues could result from the transaction. Specifically, the filing laid out two proposed packages of plants as potential options for divestiture. One of the options includes the Wallenpaupack hydroelectric plant. The announcement states, "At this point, these are simply proposals to FERC. No final decisions have been made regarding divestitures. We expect it could take three to six months for FERC to rule on our filing. If divestiture is required and includes Wallenpaupack, we anticipate it would take place after the transaction’s close." In addition, whether the operating license for Lake Wallenpaupack comes under Talen Energy or is transferred to another owner, the owner will be obligated to meet the FERC license requirements, the announcement adds. "We expect to get a better sense of timing as FERC considers our request. We’ve proposed entering into a contract or contracts for divestiture of required assets within a year of FERC’s approval of the transaction. "In the meantime, we will continue to operate these power plants safely and reliably while they remain our assets," the PPL announcement concluded. Ryan Hill, PPL spokesman, said that the intent of the federal market power tests are to insure that no power generating company grows to the point where it puts an undue influence over electrical service prices. PPL is getting ahead of the game in the event FERC requires divesture, by offering a couple options of what they would present to FERC. The two options include in each case, a PPL power plant and Riverstone plants supplying the PGM market, which includes 13 states and the District of Columbia. The other PPL plant on the table is the Ironwood natural gas plant in Lebanon County. Asked in the event Lake Wallenpaupack went up for sale who would buy it, Hill said it would be sold to an entity that intends to operate it as a generation resource. PPL Lake Wallenpaupack has a generating output of 44 megawatts and is the smallest in terms of PPL generating capacity in Pennsylvania. PPL's total output is 9000 MW in this state. Once combined with Riverstone to create Talen Energy, the total output will be over 15,000 MW. On a side note, while switching to Talen Energy will ultimately mean a changing of signs seen at Lake Wallenpaupack that now read PPL, Hill reminded the merger only affects the generating side of PPL, known as PPL Energy Supply. PPL's delivery company, PPL Electric Utilities, will still be serving the region, delivering power to homes, businesses and other companies "If the lights go out, you'll see PPL trucks on the road," Hill said. The two functions were split into separate companies when electricity deregulation was approved in Pennsylvania. The switch to Talen Energy, however, still leaves questions about future operations of Lake Wallenpaupack. Eric Ehrhardt, a member of the PPL Lake Wallenpaupack Advisory Committee as well as a Palmyra Township supervisor and local banquet center owner on the lake, commented, "no matter who owns the lake, it will be different." He noted it could be better, worse, or stay the same. "So much is up in the air right now," he said. The license requirements to operate the lake and power plant would have to be followed by any company that ends up owning Wallenpaupack, Hill noted. For a new company to make any changes, that would require a public process and federal approval. Shoreline regulations are also already in place. Certain initiatives of PPL, however, such as the Wallenpaupack Environmental Learning Center, are above and beyond the FERC license requirements. Opened in 2004, the Learning Center has become a major hub for environmental education and meeting space. Hill said that how the new owner of the lake- whatever company that may be- would have flexibility over how the license requirements are implemented. Ehrhardt referred to the local PPL power plant assets- the generating plant at Kimbles, the flow-line, the dam and 5700 acre lake we know and love as Wallenpaupack. In regards to the entire picture of PPL and Talen Energy, he said,"It's a very small piece but means everything to us."